The Income Tax department introduced the Annual Information Statement (AIS) vide Finance Act, 2020 with effect from June 1, 2020.
Under the provisions as prescribed, the income tax authority is required to upload on the registered account of the taxpayer, in the designated portal, information from certain sources in specified formats.
AIS shows both reported value (value reported by the reporting entities) and modified value (i.e., the value after considering the taxpayer’s feedback) for each type of information, i.e., tax deduction at source (TDS), and statement of financial transactions (SFT), along with other information.
Says Anita Basrur, partner, direct tax-Sudit K Parekh & Co.LLP, a one-stop solutions for assurance, tax, and advisory: “This AIS is required to be uploaded in Form 26AS. The information is to be uploaded within three months from the end of the month in which the information is received by the authority.”
AIS was introduced with the following objective in mind:
To display complete information to the taxpayer with a facility to capture online feedback.
Promote voluntary compliance and enable seamless pre-filling of return.
Deter non-compliance.
According to Archit Gupta, founder and CEO, ClearTax, a tax portal, the AIS “includes new information – i.e., details of interest, dividend, securities transactions, mutual fund transactions, foreign remittance information, among others.”
They are:
Summary of AIS information in the form of Taxpayer Information Summary (TIS) for ease of filing return (pre-filling will be enabled in a phased manner).
Taxpayers will be able to submit online feedback on the AIS information provided and download information in portable document format (PDF), JavaScript Object Notation (JSON), and comma-separated values (CSV) file formats.
AIS Utility will enable taxpayers to view AIS and upload feedback in an offline manner.
There are a few steps one needs to follow to check the AIS. They are:
Step 1: Log in to the income tax e-filing portal at www.incometax.gov.in. Then, go to ‘Services’>’Annual Information Statement’.
Step 2: Click on the ‘Proceed’ button.
Step 3: It will redirect you to the compliance portal where you can view TIS as well as the AIS on the AIS home page.
Step 4: Now, you can select the relevant financial year and view the TIS and/or AIS by clicking on the relevant tiles.
Step 5: You can also download the AIS and TIS by clicking on the download icon in the respective tiles. You can download TIS in the PDF format and AIS in PDF or JSON formats
Adds Gupta: “The PDF file is password protected. The password is combination of your permanent account number (PAN) and the date of birth in case of individual taxpayer, or date of incorporation/formation for a non-individual taxpayer in the DDMMYYYY format. For example, if the PAN is AAAAA1234A and the date of birth is January 21, 1991, then the password will be AAAAA1234A21011991,” informs Gupta.
The information is displayed in two parts. Part A and Part B.
PART A: General Information
It displays general information, such as PAN, masked Aadhaar number, name, date of birth/incorporation/formation, and contact details of the taxpayer.
PART- B
This includes details of the:
TDS/TCS Information – Information related to TDS/TCS is displayed here. The Information code of the TDS/TCS, Information description and Information value is shown.
SFT Information – Information received from reporting entities under Statement of Financial transaction (SFT) is displayed. The SFT code, Information description, and Information value is made available.
Payment of Taxes – Information relating to taxes, such as advance tax and self-assessment tax is shown.
Demand and Refund – Details of the demand raised and refund initiated (AY and amount) during a financial year.
Other Information – Details of the information received from other sources, such as data pertaining to Annexure II salary, interest on refund, outward foreign remittance/purchase of foreign currency etc., is displayed here.
At present, Form 26AS primarily displays details of the property purchases, high-value investments, and TDS/TCS transactions carried out during the financial year.
Elsewhere, AIS is a much more detailed statement. It includes details, such as, interest income earned on savings account, purchase and sale transactions of securities/immovable properties, foreign remittances, and interest on deposits, among others. All the information is available in aggregate form as well as individual transaction-wise.
“The AIS is essentially a comprehensive statement containing details of financial transactions, including income, investment, and expenditure. Elsewhere, Form 26AS is just the data of income on which tax has been withheld,” says Basrur.
If the taxpayer has earned Rs 1,700 as interest on his savings account and another Rs 42,000 on deposits from XYZ bank during the financial year, Form 26AS will only display the details of the interest earned as Rs 42,000, as that includes the details on which TDS will be deducted. At the same time, the annual information statement will show both the transaction details. In addition, the taxpayer can also see the bank account details from where the income was received, for instance, the bank name, bank account number, account type, etc. Similarly, it will display all other financial information of the previous year, such as rent received, salary, dividends, and so on.
“AIS covers TDS/TCS transactions, SFT information, payment of taxes, demand or refund, and other information. However, if the taxpayer has to verify GST turnover based on the details furnished in Form GSTR-3B, it is visible only in Form 26AS. AIS does not capture GST details,” says Gupta.
To submit the feedback in the AIS section, you will need to go to the AIS tab (as discussed above). Here you will find various sections, such as TDS/TCS information, SFT information, payment of taxes, demand and refund, and other information.
Click on the relevant information category, and choose the button ‘Optional’ to submit the feedback. It will ask you to choose the feedback type. The information will reflect the modified figure in bracket. The modified value will be used to update the derived value in TIS. The derived value is then used to pre-fill the income tax return form of the taxpayer.
The AIS will include information that is presently available with the Income Tax department. Do note that the information in the AIS will be displayed only after the reporting entities furnish the information to the I-T department. There may also be instances when the data of a particular period is not updated. Hence, the taxpayers should check all related information and report complete and accurate information in the income tax return. The taxpayer may also follow a feedback mechanism to report errors in AIS.
In case of variation between the TDS or TCS information, or the details of tax paid as displayed in Form 26AS vs AIS, the taxpayer can rely on the information displayed in Form 26AS for the return filing. However, if you have already filed your ITR and then found additional information in the AIS, you can file a revised return on the basis of information displayed in AIS. The said move will facilitate voluntary compliance and eliminate underreporting of income by the taxpayer.
